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Connecting for Good: How the Internet of Things (IoT) is Paving the Way to a More Sustainable World

As the world grapples with the pressing challenges of climate change and its cascading impacts on our planet, the focus on the social and environmental impact of business is becoming more intense. A range of different global frameworks and initiatives have emerged to help guide ethical business practices, each built upon the common recognition of the vital role that both individuals and businesses must play in addressing societal challenges such as poverty, climate change and inequality.


At a global level, the United Nations Sustainable Development Goals provide an overarching framework that aims to address 17 goals relating to a wide social, economic and environmental challenges facing the world. Developed by the United Nations in 2015, the goals are part of the 2030 Agenda for Sustainable Development and have been adopted by all United Nations Member States.

The 17 UN Sustainable Development Goals
UN Sustainable Development Goals

The global commitment to Sustainable Development Goals has naturally led to a more granular focus on how the collective activities of businesses and individuals contribute to the overall achievement of these goals. For businesses specifically, a number of sustainability reporting frameworks have been developed, such as Environmental, Social and Governance (ESG) standards, supported by the creation of the Global Reporting Initiative (GRI) and the Sustainability Accounting Standards Board (SASB) which were formed to support the standardisation of ESG reporting practices. We'll dive into the ESG standards more below.


At a micro level, businesses are also facing strong scrutiny from both employees and consumers. Research from IBM’s Institute for Business Value found that a growing number of employees seek out and embrace job opportunities within environmentally conscious firms. According to their survey, 67% of respondents indicated they were more willing to apply for roles within these firms, while 68% indicated a greater willingness to accept job offers from such companies (IBM 2022). In terms of consumers, research into purchasing intentions and behaviour has shown that approximately 84% of consumers indicated that poor environmental practices would lead them to leave a brand or company (TheRoundUp 2023). Overall, it is very clear that sustainable practices are becoming a necessity for businesses to compete in the global economy.


As a result of this increasing focus on sustainable practice, organisations have turned towards the Internet of Things (IoT) as a powerful means to achieve and report on their sustainability targets. This article will examine the ways in which IoT is shaping our approach to sustainability, generating insights that drive informed decisions that support the creation of a more sustainable future.


Sustainability: From a buzzword to key strategic consideration


Once considered a buzzword, it’s now generally accepted that sustainability should be a key driver of business strategy. But, what does it actually mean to be sustainable?


As we all know, the state of the climate is a popular topic in the media, with a growing focus being placed on sustainability in relation to our ecological impact on our planet. As a result, many people view sustainability through an environmental lens. While the environment is a key aspect, the concept is more dynamic than just this one dimension, and also encompasses social and governance principles as well. These pillars are captured under the broad concept of ESG (which stands for Environmental, Social and Governance) – a framework used by businesses to report their impact across these three key pillars. This approach enables businesses to measure and manage their sustainability practices in a holistic manner. By integrating ESG principles into decision-making processes, organisations can enhance their commitment towards creating positive societal change and preserving the environment for future generations. These three pillars are crucial in evaluating a company's sustainability and ethical practices as enacted in their day-to-day practice and are increasingly being incorporated by investors into investment decision-making processes.

ESG infographic

The pressure on businesses to engage with ESG and sustainability initiatives has been growing over the last decade, resulting in a varied landscape in relation to the maturity of businesses in relation to their ESG journey. Data from Nasdaq's 2023 ESG & Climate Survey found that 45% of respondents had been tackling ESG and sustainability for less than three years, with only 9% having been on the journey for longer than 5 years. A particular challenge faced by respondents in their research is the collection and management of sustainability data, which many were finding required investment in new technologies and systems to ensure the successful implementation of strategies.


Adoption of new technologies and organisational practices can be a costly and involved process, however, many businesses that successfully adopt sustainability practices are finding that the return is worthwhile. According to the industry survey conducted by Sphera, 34% of respondents reported that their sustainability efforts were helping to optimise processes, boost innovation, increase productivity, improve value chain efficiency and build brand value. Further benefits are outlined below:

A table about the ways in which ESG create value
5 ways in which ESG creates value

In summary, the way in which we assess the social responsibility of business is (thankfully) evolving from a Friedman-era focus on profits solely to a more holistic view of how business practice impacts our wider society and environment. A key question facing many organisations is how to overcome the challenges associated with the collection, management and reporting of data about their sustainability outcomes. Enter IoT.


IoT is a gamechanger for sustainability efforts


IoT refers to the network of physical objects, devices, vehicles, appliances, and other items that are embedded with sensors, software, and connectivity, that allows them to collect, exchange, and process data over the internet. A key capability of IoT is the ability to create a seamless integration of the digital and physical worlds, enabling these connected devices to communicate, interact, and make intelligent decisions without requiring direct human intervention. This 'smart' technology has enhanced efficiencies, convenience and functionality in our homes, industries, healthcare, transportation and more.


IoT is widely recognised as a game changer for sustainability goals. According to the IoT Guidelines for Sustainability Report released by the World Economic Forum, 84% of IoT deployments are currently addressing, or have the potential to address, the Sustainable Development Goals (SDGs). Newer technologies such as artificial intelligence have only enhanced the positive impact of IoT on the achievement of key sustainability goals. For example, AI is being used to revolutionise agricultural practices around the world. In Africa, the Africa Agriculture Watch (AAgWa) tool combines AI with a web-based platform to analyse weather, soil and historical yield data to provide predictive insights into crop growth and yield potential. The information is used to support improved decision-making about crop irrigation, fertilisation and pest control activities, ultimately improving resource efficiencies and overall crop yield.


According to recent research, key challenges faced by organisations as they transition towards mandatory ESG reporting include collecting high-quality data, and then reporting this data to external stakeholders (Nasdaq 2023). Digitisation strategies, such as the integration of IoT-based technologies, are therefore key to empowering organisations in overcoming these challenges. When looking at the three pillars of ESG, IoT can facilitate both meaningful outcomes that enhance an organisation's sustainability efforts, and also the means to report against outcomes that provide tangible evidence that can be used to demonstrate accountability and progress against set benchmarks. Let's unpack this more.


How IoT supports the environmental sustainability pillar of ESG:

  • Energy efficiency: IoT sensors can monitor energy consumption in real time, helping organisations identify areas of inefficiency and implement strategies to reduce energy waste. This leads to lower carbon emissions and operational cost

  • Resource Management: IoT devices can track resource usage, such as water, raw materials, and chemicals. This data can inform sustainable practices and optimise resource allocation, reducing waste and environmental impact.

  • Waste Management: Smart waste bins equipped with sensors can signal when they are full, enabling more efficient waste collection routes. This minimises unnecessary pickups, reduces fuel consumption, and lowers emissions

  • Air and Water Quality Monitoring: IoT sensors can monitor air and water quality in real time, helping to identify pollution sources and ensure compliance with environmental regulations. This contributes to healthier environments for communities.

  • Renewable Energy Integration: IoT facilitates the integration of renewable energy sources like solar and wind by optimising energy storage, distribution, and consumption. This reduces reliance on fossil fuels and promotes clean energy adoption.

How IoT supports the social sustainability pillar of ESG:

  • Healthcare Monitoring: IoT enables the remote monitoring of vital signs and health metrics. This is particularly valuable for elderly populations and patients with chronic conditions, enabling proactive healthcare management.

  • Safety Monitoring: IoT devices can enhance workplace safety by tracking employee locations, environmental conditions, and hazardous situations. This reduces accidents, promotes worker well-being, and maintains compliance with safety regulations

  • Disaster Management: IoT sensors can provide early warnings for natural disasters like earthquakes, floods, and hurricanes. This helps governments and communities take timely actions to minimise damage and protect lives.

  • Agricultural Efficiency: IoT-enabled precision agriculture monitors soil conditions, crop health, and weather patterns. This leads to optimised resource usage, reduced pesticide usage, and increased crop yields.

How IoT supports the Governance pillar of ESG:

  • Transparency and Accountability: IoT data can enhance transparency in supply chains, verifying product origins, conditions, and compliance with ethical and sustainability standards. This builds trust with consumers and investors.

  • Ethical Sourcing: IoT can track raw materials' origins, verifying that they are sourced from ethical and sustainable suppliers. This aligns with responsible sourcing practices and reduces the risk of using conflict minerals.

  • Data Security: With increased connectivity comes the need for robust cybersecurity. Ensuring data privacy and security in IoT systems aligns with good governance practices and protects both organisations and users.

  • Stakeholder Engagement: IoT-driven data can enhance engagement with stakeholders like employees, customers, and communities. Sharing sustainability efforts and outcomes fosters positive relationships and encourages collective action.

  • Supply Chain Efficiency: IoT-enabled supply chain monitoring improves logistics, reduces waste, and enhances inventory management. This optimises resource usage and reduces the carbon footprint associated with transportation.


To wrap up, the evolution of business ethics from profit-driven paradigms to holistic approaches that encompass environmental, social, and governance considerations is undeniably underway. As businesses grapple with the imperative to align their operations with global sustainability objectives, the emergence of the Internet of Things (IoT) stands as a pivotal solution. IoT's ability to seamlessly gather and analyse data from interconnected devices facilitates precise insights, propelling informed decisions that drive sustainable practices. By leveraging IoT technology, businesses can navigate the complex landscape of ESG considerations, fostering positive change for our planet, society, and economic ecosystem. As we stride into this era of interconnected intelligence, IoT offers the transformative potential to elevate business sustainability from a concept to a reality.


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